Sendy, an on-demand delivery platform based in Nairobi, Kenya has raised $2m from Goodwell Investments to improve access of lower-income groups to good quality basic products and services, at much lower prices.
Sendy, which was the first to offer an on-demand delivery platform in the region, currently covers Kenya, Uganda, and Tanzania and plans to cover all East Africa in the near future.
Launched in Nairobi, Kenya, in 2015, Sendy matches cargo and parcel owners to third party transporters, so taking the friction out of supply and demand. The platform connects individuals and small businesses to a network of third-party transporters – motorbikes, vans and pickup trucks.
Sendy’s primary revenue stream is a per-delivery commission charged to the logistics partner.
Today in East Africa, logistical costs account for a staggering 40%-plus of the consumer price, due to poor infrastructure, limited use of technology, inefficient capacity utilization and a lack of pricing transparency. Food prices and prices of household goods and health services are therefore heavily inflated, negatively affecting the standard of living of at least 170 million people in East Africa.
In its first year, Sendy completed 12,000 deliveries, had 27 drivers on its platform and revenues totaled USD 45,000. In the three years since, the company has grown fast. It has now completed over 180,000 deliveries, has more than 700 drivers on its platform and posted revenues of USD 1.5 million in 2018.
Sendy is also exploring new distribution models. For example, the company is piloting a so-called ‘agency model’ in which packages are aggregated at a central collection point before delivery to the customer. The agency model is expected to help increase efficiency and improve margins.
“Sendy is already a gamechanger in the logistics sector,” comments Joel Wanhoji, senior investment manager of the Goodwell East Africa team.
“Its cutting-edge technology brings efficient capacity utilization and transparent pricing to a sector that was previously seen as being beyond change. Sendy’s platform is enabling savings of more than 20% on the logistics costs, which makes Sendy a good fit within Goodwell’s uMunthu mandate of providing basic goods and services to people on low and middle incomes – the majority.”
Sendy’s user-focused technology platform helps cut logistics costs by simply and transparently connecting individuals and businesses to third party delivery drivers across Africa. Goodwell also took part in MAX.ng in $7.5m investment round, Insurtech startup Inclusivity Solutions, Copia and MFS Africa.
In 2018, the firm Goodwell Investments launched a new EUR 20 million fund for investments in the inclusive economy in Sub-Saharan Africa to meet the growing demand for impact investments from private investors, family offices and foundations.